ENERGY BILL FIGHT: VOTE FRIDAY?

The cost of oil is climbing toward $100/ barrel and prices are rising precipitously at the gas pump. Politicians are using the public’s anger about these facts to draw attention to the pending energy bill.

The President’s call for the development of domestic biofuels has led to a Renewable Fuels Standard (RFS) in the legislation. Senate Democrats added a new, more demanding Corporate Average Fuel Efficiency (CAFÉ) standard for US auto mileage. House Democrats passed a Renewable Electricity Standard (RES) mandating that utilities obtain 15% of their electricity from renewable sources by 2020.

Automakers object to the CAFÉ standards and utilities oppose the RES. Nothing in the legislation will do anything about the price of gas at the pump or home heating costs in the short run. The provisions, however, are in the best interests of the country. Which doesn’t necessarily mean special interests will let them pass. (See: DALLAS PAPER: TEXAS POLS BLOCK ENERGY BILL GOOD FOR TEXAS)

But there is good news. State legal actions may force the EPA to impose auto emissions standards more rigorous than anything the Democrats can legislate. And the White House may accept a compromise RES, especially if it allows utilities to include efficiency measures as a part of their required renewables.

The bill could even include important Production Tax Credits (PTCs) for New Energy in exchange for giving the President his RFS and not taking too many tax incentives away from his oil and gas cronies.

And if Speaker Pelosi gets her way, it will all play out this week. Get ready to rumble.

Will they still believe next week? (click to enlarge)

Pelosi to push for vote on energy bill
November 9, 2007 (UPI)
and
US House members trade charges as oil price climbs
Nick Snow, November 8, 2007 (Oil & Gas Journal)

WHO
Speaker of the House Nancy Pelosi (D-Calif), Senate Majority Leader Harry Reid (D-Nev), House Minority Whip Roy Blunt (R-Mo.)

WHAT
While Senator Reid and Speaker Pelosi struggle to work out compromises on the several contentious issues in pending energy legislation, Pelosi announced she wants to get the bill to a vote and Congressman Blunt hurled criticisms at the leaders for their efforts.

WHEN
Pelosi announced she wants to bring the energy package to a vote before the Thanksgiving recess at the end of the day November 16.

WHERE
The energy legislation is now stuck on Capitol Hill. If Pelosi and Reid get a bill through both houses of Congress, a confrontation with the White House may follow.

WHY
- Congressional Republicans refer to the mix of Democrat-sponsored provisions as a “no-energy” bill because it shifts incentives away from fossil fuels to renewable fuels and other New Energy.
- The two key unresolved and highly contentious measures are CAFÉ standards, requiring all cars and light trucks to get 35 mpg by 2020, and the national RES, requiring utilities to get 15% of their electricity from renewable sources by 2020.
- Three other key pieces are more widely accepted: (1) the Renewable Fuels Standard (RFS) calling for more ethanol production and use, (2) more rigorous efficiency standards for appliances and lights, and (3) production tax credits (PTCs) for renewables.
- Both bills repeal tax breaks for fossil fuels industries and shift them to the renewable energy industries, a provision Republicans vigorously oppose.
- Some utilities contend the RES would drive up their costs.
- Automakers want CAFÉ standards that keep trucks separate and require lower mileages.

More than half of US states already have an RES (Renewable Electricity Standard, previously known by the arcane title Renewable Portfolio Standard). Creating one national standard gives businesses and utilities all across the country clarity and certainty, incentivizing future development. (click to enlarge)

QUOTES
- Pelosi: "…I'd like to [pass the energy bill] because it's Thanksgiving…For the nearly 7 years of the Bush administration, the rising cost of gas and home heating oil has been a major economic stress on millions of American families. The response from President Bush has been to promote new benefits and tax breaks for an industry already enjoying record profits. The American people, not the oil industry, need help from their government…We will vote soon to pass this bill and send it to the president for his signature…"
- Blunt: "[Americans want energy they know and] that means unlocking new supplies, encouraging conservation, and promoting the research and innovation we'll need to adapt to the future…For every 25¢ increase in the price of gasoline, it's estimated that $100 million a day is taken out of our economy. If you're counting at home, gas has gone up more than 70¢ since Democrats took control in January. And if they're successful in passing their no-energy bill this winter, it'll go up a whole lot more than that…"